Before we get to this week's conversation, I am very pleased to announce that Doug Casey has just published a new book, featuring some of our best conversations: priceless takes on a wide variety of subjects, including the TSA, war, corruption, Cuba, and your health. Many of the subjects covered in this publication and the book – like the one Doug and I discuss below – are the result of questions from readers. The book, Doug's first in many years, is called Totally Incorrect, and is a convenient way to share Doug's singly unique and insightful perspective with others.

Thanks for reading and contributing. Our audience very much helps shape the course of these conversations.

Best regards,

Louis JamesSenior Metals Investment StrategistCasey Research

L: Hola Doug, what's on your mind this week?

Doug: I got a letter from a reader in India – Shanmuganathan – asking some very interesting questions regarding my views on karma. Feel like talking philosophy? It will make us feel like we're back in a college dorm room, enveloped in a haze of alcohol and smoke – at least in my case.

L: I didn't smoke even back then, but I did my fair share of drinking in college. There are stories… At any rate, sure, I'm game. You often say you're a solipsist, but never go into it – and that has to be related. Now is as good a time as any to get metaphysical.

Doug: It is. But let's start with a definition, as always. My Webster's Dictionary says:

Karma: The force generated by a person's actions held in Hinduism and Buddhism to perpetuate transmigration and in its ethical consequences to determine the nature of the person's next existence.

L: Clear as mud.

Doug: Must be written by a professor. My translation into English would be: In Buddhism and Hinduism, the ethics of one's actions are believed to shape one's next life, after you are reincarnated.

But I like to look at it in a less religion-specific way. I see it as a general "what goes around comes around" principle. Put simply: causes have effects. You reap what you sow. If you do things that harm other people, there will tend to be a certain kind of reaction, and you probably won't like it. In this sense, yes, I do believe in karma. But that leads to a bigger question: whether we are reincarnated. Which is to say, what is the nature of reality itself? Are you just a biomechanical body? Does that body have a "soul," as the Christians believe? Or are you actually a spiritual entity that is just temporarily inhabiting a body – which is different.

L: Okay, but before we tease that apart, can you tell those among our readers who may not know what a solipsist is?

Doug: There are many versions – just as there are many notions of karma – but the basic idea is that you create your own reality. The most extreme version of this is that all of reality is just a figment of your imagination. It's all in your head.

L: If it's all in your head, where is your head? It must exist, and therefore there must be a reality of some kind in which it exists, or even the illusion you may be imagining doesn't happen.

Doug: I wouldn't go quite that far. If pushed, I would say that reality is like a common construct of almost everyone's imagination. I control my own reality, as you control yours. Outside there are seven billion other humans; I'm not about to deny their existence.

L: Aw, you're spoiling the fun, Doug! If our world is not all just a figment of your imagination, I can't blame Obama, Bush, the Clintons, and all the horrors around the world on your perverse imagination.

Doug: [Laughs] Well, that relates to why I'm currently working on a sextet of novels – a series, each stranger than the last, which will explore the nature of reality on this obscure little ball of rock by reforming the reputations of six unjustly besmirched, politically incorrect occupations. As Will Rogers correctly said, "It's not what people don't know that's the problem. It's what people think they know that just ain't so."

L: But seriously, this doesn't help me, Doug. Reality must still have external existence to the collective imagination – exist for the same reason an individual head must exist for the mind it contains to imagine anything.

Doug: If you're actually a spiritual entity, then "you" don't need your brain or your body – they're just tools for dealing with the world of matter, energy, space, and time. This is what people mean when they say they get out of their bodies. As you know, I'll entertain almost any concept about almost anything. I've talked with a number of people personally – who seemed absolutely sane and sincere – who claim to have done that. And, like most of us, I've read third-party accounts of OBEs (Out of Body Experiences). Regrettably, I haven't had one. Nor have I seen a real Indian rope trick. The whole area is overrun with charlatans and psychos. So I'm highly skeptical. But I do cotton to the concept of mind over matter. Therefore I keep an open mind on the nature of reality.

It's a paradox to me that religionists of all stripes believe in the magic recounted in their holy books (virgin births, transubstantiation, teleportation, miracles of a thousand kinds) and they aren't willing to discuss these things as other than dogma. At a minimum, I find it makes for an entertaining conversation.

Seriously, though, the nature of reality is very uncertain even among – or especially among – theoretical physicists. As anyone familiar with modern physics knows, what feels like solid matter to us is really mostly clouds of electrons surrounding nuclear particles that are themselves clouds of quarks and other smaller particles… At heart, quantum mechanics seems to suggest these things may or may not even exist until we look for them.

L: At heart, everything is a distribution of probabilities – the universe is math?

Doug: Something like that. It's been said that any sufficiently advanced technology is indistinguishable from magic. So for all we know, we could be living in The Matrix. I'm urgently looking for the red pill.

L: [Chuckles] Have you read Neal Stephenson's Anathem? It's his best book, in my opinion. In it, he looks into these issues in a most clear, insightful, and humorous way.

But let's not get distracted. The point is that the many-worlds interpretation of quantum mechanics – and the possibility of communication between alternative realities – gives us a plausible explanation for many things some people might regard as supernatural.

Who knows, it might even be possible that Napoleon Hill was literally right, and that our thoughts affect the world around us. We can think positively about wealth and grow richer. Some people believe that if they want something they only need "manifest" it. Personally, I'm all for keeping a positive, happy thought, but since we live in the material world, it's also very helpful to employ things like diligence, persistence, intelligence, and a whole bunch of other virtues to make sure the manifestation occurs.

L: And we can't afford the luxury of a negative thought. I do agree with Hill, but Doug, I always understood that to be a psychological phenomenon. When you're depressed and anxious, it shows; people can see it, and most don't want to be around such people. The negativity becomes a self-fulfilling prophecy, a very vicious cycle. Conversely, when people project optimism, strength, and ability, most people respond to that positively – even if it isn't true, as politicians illustrate every day. This is quite different from our thoughts operating on a quantum level and somehow altering reality from the subatomic level on up…

Doug: Yes and no. When I imagine a red cat in my mind and have him move around as I wish, does he exist? I'd say yes, on some level, even though he has no mass, and I can locate him anywhere in space I wish. I lift a book with my hand, I move all the atoms in it, all the particles and waves that comprise it, and it interacts differently with the universe, via light, gravity, and no one knows how many more ways.

L: Okay, but when I drop that very heavy book of medieval metaphysics on my foot, cause has effect, and I feel the unpleasant effect shortly. That's quite different from wishing I'd get a million dollars in the mail and the thoughts in my mind somehow reorganizing the particles and waves that make up the world around me so that the mailman arrives with a dishwasher-sized box full of $100 bills.

Doug: Is it? I'm not denying the laws of physics. The clouds of almost-emptiness that we think of as our bodies interact with the equally almost-empty space around us in ways that no one fully understands. When you drop that book, you create the future moment in which it hits your foot. We all create reality as we go – and who can really say how deep that process reaches?

But we don't have to argue about that; we agree wishing is not a very effective way to influence the world around us. Taking action tends to be much more effective. Whether that's in the apparently solid world of the proteins and other chemicals that make up your body and mind or something deeper, the outcome is the same. And the idea of karma encourages people to take responsible and constructive actions. I'm all for things that encourage people to take responsibility for their actions.

L: I suppose…

Doug: This reminds me of something my old man once said. I've said it before, but it strikes me as being profound enough to bear repetition. I was about 20 years old, and I'd asked him some sort of cosmic question. His answer was: "It's all a matter of economics." Some months later, I asked him another cosmic question, and he said: "It's all a matter of psychology." I've thought about these answers often over the years, and it seems to me that they are absolutely correct. Almost everything in the material universe boils down to economics, and almost everything in the non-material world – what you might call the spiritual universe – is a matter of psychology.

L: Hmmm…

Doug: Think about it. It'll grow on you. The essential point for now is that I do believe in cause and effect – more specifically, that actions have consequences. If you look at that from an ethical perspective, that's really what karma is all about. In point of fact, all causes have effects, all actions have consequences, and no one can ever escape those consequences – not for long.

L: Karma is cosmic payback, via psychology and economics?

Doug: Yes. Simply put, karma means things can and will come back to bite you, so you're well advised to anticipate the consequences and be prepared to accept them.

L: I would agree with that… and I'm not a solipsist. This is why I'm not afraid that real freedom will lead to chaos in society. Success in a free society requires responsibility. This is an inescapable fact that manifests itself in the myriad self-regulating features of the market – and a "market" is really nothing more than a kind of mass psychology. Your father's second, and perhaps deeper, answer.

Doug: Okay then, let's look at Shanmuganathan's questions. He asks:

"How do we explain the crooks and evil guys having a jolly good life on the planet? Why does karma not do its… karma?"

Well, I suspect that if we could explore and understand the inner psychology of such people, we'd find that they are not actually having a very good life, even if they appear to be. A good case can be made that criminals, even if they have genius IQs, are actually stupid – if we use my preferred definition of the word: showing an unwitting tendency to self-destruction.

When people look at the apparent success of criminals, they only look at their material possessions. But that's very shortsighted, even though possessions are important. They fall into the realm of "have." Things you have aren't part of you; they can be lost or taken away. More important is the realm of "do." Things that you do are indicators of who you really are. But most important is the realm of "be." Things that you are represent your essence.

My view is that a wise and ethical person concentrates on "beingness." If you get that right, you're capable of doing. And the doing results in having. The reality of the average person you see at Walmart in those Black Friday videos seems to begin and end with "having."

Criminals tend to focus largely on having, less on doing, and not at all on being. Especially as life goes on, I believe that takes a toll on them. Their being starts to resemble The Picture of Dorian Gray.

L: I don't doubt that a guy like Muammar Gaddafi was far from being a truly happy man, long before he came to his grisly death.

Doug: Right – and he's by no means alone, and certainly far from the worst. It's a sign of how degraded the average human is that they apotheosize criminals – people like Mao and Stalin still have gigantic fan clubs. Almost all professional politicians are of that type – although very rarely on their scale.

L: Do you suppose Gaddafi had an official food-taster?

Doug: I'm sure all those guys do, including the president of the US; they know that many, many people want them dead. Of course there are a few real bad apples out there who are enjoying a very good life at the present. It's just a matter of statistics. There's nothing about karma that says everyone gets their just deserts immediately. As in economics, the immediate and direct effects are easy to see; the indirect and delayed effects are often both more subtle and more important. It certainly appeals to many people's sense of justice, including my own, to think that people always get what they deserve. If you actually are a spiritual entity, you can't escape your fate by dropping your current body. The Hindus who originated the idea of karma definitely believe in reincarnation.

As we've touched on many times, I don't believe in any of the doctrines of the world's major religions – gods, goddesses, heaven, hell, etc. – but I am inclined to believe that living beings inhabit physical bodies for a time but have a separate existence. I have absolutely no proof for that. It's based on intuition, not hard data.

L: That's unusually candid for a believer, Doug. But come on, you never believe anything just because you'd like it to be so – you scorn investors who make that mistake. You must have had some experiences that convince you this is possible…

Doug: I hate to be characterized as a believer, since I'm a professional skeptic. That said, I've had several relevant experiences, actually, that are completely inexplicable but very real. But they occurred in my mind, as opposed to the material world. Many, many other people have as well. I'm not talking about experiences induced by drugs, alcohol, or the like.

L: Sure, but I've never heard a story that couldn't be logically explained – head trauma, anoxia, hypothermia… simple inebriation.

Doug: Understood. The mind is very good at tricking a person; David Copperfield, Penn and Teller, Chris Angel, and others are masters at it. Sure, so it's likely pointless to debate what happens after death. Although, as you know, I don't like to argue or debate anything – it's much more productive, as well as pleasant, to have an open-minded discussion, to see if one can learn something – at least about one's self or others, if not about physical reality.

For now, I'll add that just because, waaaay out on the edge of the bell curve, there are some people who do bad things and "get away" with them, that doesn't change the fact that for most people, most of the time, the consequences of truly evil actions are real, serious, and usually not long delayed. It's why ethics is so important, however underrated.

L: Cosmic just desserts with a quantum cherry on top. Whether as a matter of economics or psychology, the odds are the same; being nice beats being naughty, and being creative beats being destructive. Spiritualism optional.

Doug: Well said. One thing I like about this perspective is that karma isn't a god, and doesn't require any consciousness – godly or otherwise – to operate. It's just the way the universe works. The laws of physics, economics, and karma have a life of their own. And that gets to Shanmuganathan's second question:

"How does karma affect the well-meaning but idiotic economists? The best example is India's Prime Minister, Dr. Manmohan Singh – an economist by profession. Very honest and simple guy, but completely idiotic when it comes to economic policies wherein a nation of a billion people are forced into poverty because of his ideas. How should karma treat such people?"

Other people may have different views, but in my view, karma is not a conscious process; it's an aspect of the nature of our universe. Statistically, there are outliers that seem to flaunt karma, but that doesn't mean karma isn't working – it's just the law of large numbers. If you do a lot of bad things, you increase the number of shots people take at you. Sure, it's possible to dodge all the bullets, but that's not a great business plan. The Bible was quite incorrect to say that the bread goes not to the wise, nor the race to the swift, nor the battle to the strong. Damon Runyon had a much better grip on reality and karma when he pointed out, "Maybe – but that's not the way to bet."

L: Ah – Ecclesiastes. It's the way to play the odds.

Doug: The universe itself is based on probabilities. So there is no sense saying karma "should" do something. As a speculator, as an investor, and as a gambler – I wear each hat at different times – I base my life on assessing odds. My perception and belief is that acting responsibly – acting as though payback is coming, one way or another – leads to a better life in this life. And it's the only thing that can help the next one, if there is one, after you discard this body.

This is why I believe in what you might call basic virtues: productivity, prudence, patience, persistence – we're big on the letter P around here, like the 8 Ps [laughs] – plus a bunch of others like fortitude, honesty, gratitude, courage. Not so big on faith, hope, and charity – which are typically vices. I believe these virtues are their own rewards. Maybe that's what karma is: the aspect of the universe that rewards virtues and punishes vices.

L: I thought you didn't believe in vice…

Doug: [Chuckles] Well, as always, we have to be careful to use words accurately, to forestall misunderstanding. As I just pointed out, conventional religious virtues are typically vices, but most things people think are vices (like smoking, gambling, drinking, swearing – all things fun) are usually no more than diverting foibles. But there certainly are some anti-virtues: larceny, brutality, dissipation of wealth, willful stupidity, cruelty. At any rate, karma is just another way of saying that these things have negative consequences, just as virtues are their own reward.

I'm still thinking about all of this – just as people before me have for thousands of years. It's easier to ask these questions than to answer them, as you know. What do you think?

L: Me? These are "Conversations with Casey," not "Conversations with Wolf" – people want to know what you think.

Doug: Maybe, maybe not. After all, in Plato's dialogues, I thought that what Glaucon had to say was just as interesting as what Socrates had to say – Socrates just had a better PR agent in the form of Plato.

L: [Laughs] Well… I've always been more in the Aristotelian camp – I've no use for Plato's world of ideal forms. Like Bud Conrad, I'm an empiricist; I want to know what the data show. And in 47 years of life, I have never experienced or seen any data that makes me believe in anything supernatural.

Now, you might say that your individual life force, your essence, your soul, or whatever you want to call it, inhabiting a particular body for a given time is not supernatural, but just a non-matter aspect of nature. Fine, but I've never seen any evidence of that, either.

All the evidence I have seen tells me that life is nothing more than a self-sustaining chemical process. So is sentience and even sapience. Like a fire, my life will last as long as I can find fuel, not get clogged up with ash and soot, etc. And when I go out, nothing will be left but decay and a little fading heat. That and my intellectual legacy, which too will likely fade, though I hope it lasts longer than it takes my body to cool to ambient temperature.

Mind you, I don't declare that what you believe is untrue – only that I see no evidence for it.

So, not wanting to count on evil deeds being punished in the next life, I'm very keen on just desserts in this life. This is part of why I'm so keen on self-defense and resisting crime – especially crimes by those in uniform. If I had Bruce Wayne's net worth, I would definitely have the same vigilante streak in me. Don Quixote is my hero.

Doug: [Laughs] A rational analysis, as I'd expect from a guy who makes his living digging the truth out of corporate executives, and sometimes the ground itself. I can't argue with what you say – apart from the fact I don't argue – if only because you're quite correct: there is no hard proof for these things. But even though I do believe karma generally gets things done, it certainly doesn't mean you have to rely on it. I'm reminded of the famous poster with two buzzards sitting on a tree in the desert. The one says to the other: "Patience, my ass. I'm going to kill something."

But back to Shanmuganathan's second question. If it's true that we construct and control our own realities, I doubt that most supposedly well-intentioned idiots really are that well intentioned. There are no accidents. That's why I tend to be rather suspicious of people who are accident-prone.

L: [Laughs]

Doug: I'm serious. People who create "accidental" train wrecks via misguided public policy are not in the same class as people who routinely stub their toes and drop glasses, but in both cases, their actions tell you something about them. Didn't Jesus say: "By their fruit shall you know them"?

L: I agree about political apparatchiks. The entire class of people in public policy who are sincerely well intentioned may be limited to one man: Ron Paul. But even if it's a bit larger, I'm sure most political entrepreneurs are at the very least manipulators who want to try to force others to do as they think best. But I suspect most are outright criminals – sociopaths, as you say – using the most leverage they can get for their predations. The existence of Santa Claus seems more probable to me than the existence of a misguided plunderer or economy-smasher.

Doug: I agree, of course. And, regarding the "well intentioned," even – or indeed, especially – the worst criminals don't think they're doing anything wrong. Hitler really thought he was a hero for trying to eradicate the Jews. Hitler, Stalin, Pol Pot, Mao, Caesar, Alexander – all of history's most famous mass murderers – all sincerely believed they were doing good. It's one sign of a sociopath. There's a lot of truth to the saying that the road to hell is paved with good intentions.

And like you, I'm all in favor of "helping" those who commit misdeeds meet the consequences of their actions sooner, rather than later. But I do believe that even if we don't, karma will catch up with them sooner or later. Either way, if you act in ways that draw "bad karma" to you, you face increased odds of both immediate and direct retribution as well as long-term settling of the books.

So whether you believe you are a spiritual being clothed in your current human form only temporarily or a complex piece of meat that will go out of existence like your fire, cultivating good karma is a great guide for personal ethics.

L: It fits perfectly with what you've said should be the only law needed: do as thou wilt, but be prepared to face the consequences.

Doug: That's not an accident either.

L: But if the odds dictate the same behavior, whether or not karma exists, what use is the concept?

Doug: Well, I believe karma exists, whether you believe it or not. [Chuckles] Or whether you exist or not. Let's just say that it's a way of thinking about these things that can help people live better lives and enjoy them more.

L: Fair enough. I don't see any direct investment implications.

Doug: No; I'd say there are life implications.

L: Okay, then – thanks for an unusual and stimulating conversation.

Doug: My pleasure, as always.

Inside the Mind of a Multimillionaire

Did you ever wonder how famous investors and self-made multimillionaires think – what it is that makes them so successful? Then you should let Doug Casey give you a piece of his mind.

"There is no other modern American critic who is half as brilliant. Doug is the only person on the scene today who could rightfully claim Mencken's mantle. What's in this book will show you the world in a new light. It will allow you to see the world as it really is... which is a gift everyone should enjoy."